Obama's health care overhaul hits big legal setback

WASHINGTON — President Barack Obama's historic health care overhaul hit its first major legal roadblock Monday, thrown into doubt by a federal judge's declaration that the heart of the sweeping legislation is unconstitutional. The decision handed Republican foes ammunition for their repeal effort next year as the law heads for almost certain eventual judgment by the U.S. Supreme Court.

The ruling by U.S. District Judge Henry E. Hudson, a Republican appointee in Richmond, Va., marked the first successful court challenge to any portion of the new law, after two earlier rulings in its favor by Democratic-appointed judges.

The law's central requirement for nearly all Americans to carry insurance is unconstitutional, well beyond Congress' power to require, Hudson ruled, agreeing with the argument of Virginia's attorney general — and many of the Republican lawmakers who will take control of the U.S. House in January. Hudson denied Virginia's request to strike down the law in its entirety or block it from being implemented while his ruling is appealed by the Obama administration.

"An individual's personal decision to purchase — or decline to purchase — health insurance from a private provider is beyond the historical reach of the Commerce Clause," said Hudson, a 2002 appointee of President George W. Bush.

Nevertheless, the White House predicted it would prevail in the Supreme Court, although it may be a year or two before the health care law gets there. The next step for the Virginia lawsuit is the 4th U.S. Circuit Court of Appeals in Richmond, where Democratic-appointed judges hold a majority.

But in the short term, the latest court ruling hands ammunition to GOP opponents as they prepare to assert control in the new Congress with promises to repeal the law. Obama in turn has promised to veto any repeal legislation and appears likely to be able to prevail since Democrats retain control of the Senate.

Whatever the eventual outcome, Monday's ruling could create uncertainty around the administration's efforts to gradually put into effect the landmark legislation extending health coverage to 32 million uninsured Americans. And it can only increase the public's skepticism, which has not significantly receded in the months since the law's enactment, defying Obama's prediction that it would become more popular as the public got to know it.

Obama aides said implementation would not be affected, noting that the individual insurance requirement and other major portions of the legislation don't take effect until 2014.

Underscoring the potential for Hudson's ruling to become a political cudgel for the new Republican House majority, incoming House Speaker John Boehner, R-Ohio, quickly cautioned states against "investing time and resources in Obamacare's implementation now that its central mandate has been ruled unconstitutional."

"Republicans have made a pledge to America to repeal this job-killing health care law, and that's what we're going to do," said Boehner.

White House officials sought to play down the significance of the ruling, noting that two other federal judges have upheld the law as constitutional in recent months, and that other lawsuits are going forward. Arguments in a lawsuit by 20 states against the legislation get under way Thursday in Florida. That lawsuit also challenges whether the federal government can require states to expand their Medicaid programs.

State Senate President Mike Haridopolos, R-Merritt Island, said the Virginia ruling bodes well for the Florida case.

"Clearly Congress cannot compel Americans to either purchase a product or pay a fine," he said in a news release. "I'm encouraged by today's ruling, but we still have plenty of work to do to ensure our constitutional rights are protected from big-government mandates."

Haridopolos wants Florida lawmakers to approve a bill asking voters in 2012 to consider a constitutional amendment designed to block the portion of Obama's health care plan that requires people to buy insurance or face a penalty.

The Legislature passed a similar amendment last year, but the courts struck it from the Nov. 2 ballot because the summary made political statements. This time around, Haridopolos tweaked the language.

The Virginia lawsuit gained a high profile because it was pursued by the state's outspoken attorney general, Ken Cuccinelli.

In his ruling, Hudson largely agreed with Cuccinelli's argument that Congress exceeded its authority, and he dismissed the Justice Department's argument that the insurance-buying requirement would come under the definition of regulating interstate commerce, a power given to Congress by the Constitution.

Hudson limited his ruling to striking down the so-called individual mandate, leaving intact other portions of the law — something supporters cast as a victory. But administration officials and outside analysts agree that important provisions of the legislation could not go forward without the requirement for everyone to be insured. That's because insurers need to have large pools of healthy people, who are cheap to insure, or it is not financially tenable for them to extend coverage to anyone with a pre-existing condition or guarantee certain policies to nearly all comers.

Some provisions of the law took effect in September, six months after its passage, including free preventive care, an elimination of lifetime limits on coverage and a requirement for insurers to allow adult children to stay on their parents' health plans until age 26.

Times staff writer Janet Zink contributed to this report, which also contains information from the New York Times.

Challenges so far

U.S. District Judge Henry E. Hudson wrote that the law's central requirement that most Americans obtain health insurance exceeds the regulatory authority granted to Congress under the Commerce Clause of the Constitution.

Because the Supreme Court has said the clause allows Congress to regulate "activities that substantially affect interstate commerce," judges must decide whether the failure to obtain insurance can be defined as an "activity."

In October, U.S. District Judge George Steeh in Michigan ruled that the insurance mandate fit within congressional power under the Commerce Clause. On Nov. 30, U.S. District Judge Norman Moon in Lynchburg, Va., ruled the same. President Bill Clinton appointed Steeh and Moon. President George W. Bush tapped Hudson.

Lawyers for both sides agree that the Supreme Court will eventually decide the legality of the health care legislation.

What's next

A federal judge in Pensacola is scheduled to hear arguments Thursday in a lawsuit brought against the federal health care law by Florida and 19 other states.

Outgoing Attorney General Bill McCollum filed the health care suit in Florida. Incoming Attorney General Pam Bondi has pledged to carry on the litigation when she takes office in January, calling the law unconstitutional and unaffordable.